01 Sep 2026

Botswana is shifting from financing individual farmers to financing bankable agricultural value chains in a bid to unlock investment, improve productivity and transform the agriculture sector.

Minister of Land and Agriculture, Dr Edwin Dikoloti, said this at the launch of the Botswana Agricultural Financing Strategy in Gaborone recently.

The strategy, he said meant that financing should increasingly be linked to real economic activity, including markets, contracts, credible off-takers, aggregation, production, insurance, infrastructure and visible cash flows.

He said a farmer was a part of the value chain while the financier, producer, input supplier, service provider, insurer, aggregator, processor and off-taker were all participants in the same economic system.

Dr Dikoloti said when these relationships worked together, it would be possible to finance not only an individual loan, but a viable agricultural business.

He said the success of the strategy would depend on its implementation and that a phased approach had therefore been adopted.

He said the first six months would focus on establishing institutional foundations, building a baseline, conducting a diagnosis, addressing legal gaps and preparing pilot projects.

“Thereafter, the 18 to 24-month launch phase will test the model through three priority value-chain clusters.

 Successful models will then be scaled, while interventions that do not deliver will be redesigned or stopped,” he said.

Dr Dikoloti said the approach was important to ensure that government did not scale up failure, but instead scaled interventions based on evidence.

“Every Pula committed under this strategy must be capable of answering three questions. The first is, what problem are we solving? The second, what results are we buying? And finally, how will we know whether it worked?” he said.

He said accountability would be strengthened through a high-level Agriculture Finance Strategy Steering Committee and a Delivery Unit responsible for coordination, implementation, monitoring, reporting and resolving bottlenecks.

 “Let us finance productivity. Let us finance resilience. Let us finance enterprise. Let us finance value addition. Let us finance the future of Botswana’s agriculture. And, above all, let us finance our True North,” he said.

Representing the Food and Agriculture Organisation (FAO, sub-regional coordinator and FAO Botswana representative, Dr Patrice Talla said agriculture remained fundamental to food security, employment creation, rural development, economic diversification and climate resilience.

 Furthermore, he said the financing strategy sought to move beyond fragmented and subsidy-dependent approaches toward a coherent trans-financing architecture that segmented, data-driven, market-oriented, risk-shared and institutionally accountable.

 “Agriculture is not a single homogenous market. Smallholders, farmers, emerging commercial producers, processors, exporters, cooperatives, youth-led enterprise and agribusiness each face different opportunities, production cycles, risks and financing requirements,” he said.

 He also said successful agricultural finance system must therefore be based on solutions tailored to specific value-chains, market opportunities and consumer segments because the strategy recognised the reality.

 He said the strategy sought to unlock investment through practical financing instruments linked to production, value chains, reliable market, credible up-takers, insurance mechanisms, leasing facilities, guarantees and risk-sharing arrangements that could increase confidence among producers and financiers.

 “The current global economic environment makes this shift even more urgent. Public resources and development assistance are becoming increasingly constrained,” he said.

Business Botswana Agriculture Sector Chairperson, Mr Boiki Tema said the private sector partners and farmers would be held to task with regards to the implementation of the strategy, the delivery of the subsidies because there was a lot of fraud, waste and abuse coming from some of their members.

Mr Tema said farmers would be segmented so that interventions would be directed and impactful to the different services.

“I can understand the frustration of financial institutions where they are hesitant to fund into this sector because of the risk, but I must also say financial institutions and commercial banks have always financed agriculture. The only thing is that we have not segmented those instruments,” he said. ENDS